Throughout 2020 the IPv4 market has been very active in all the major internet registries including ARIN, RIPE and APNIC.
Unlike other industries that have suffered decreased demand for their services due to physical lockdowns and government mandated quarantines, hosting companies, ISP’s, cable providers and telcos have been trying to keep up with the increased demand for IPv4 address usage generated from more people being forced to stay indoors.
Furthermore, the new work-from-home approach doesn’t seem like it will go away in 2021, as organizations have learned their employees can perform their jobs without the need for a physical office space, which allows most companies to cut overhead costs and prematurely sever long-term lease commitments.
While Brander Group’s teams has been able to successfully fill IPv4 purchase orders in a timely fashion, we have noticed that there has been a substantial increase in demand from our clients in Q4 of 2020.
Based on all of the data, there is a strong indication that IPv4 prices will likely increase in Q1 more than the usual 5% quarterly increases.
4 main reasons for this price increase include:
- Positive news regarding Covid Vaccines
As we get closer to a Covid vaccine being released, the confidence of organizations grows stronger. This encourages them to spend more Opex and Capex in 2021 with the understanding that revenue will increase in the coming year
- End of Year Budgets
Q4 is always a time when prices increase because every company wants to spend end of year budgets to ensure they have the same budget the following year. What better way to justify spending excess funds than purchasing an appreciating asset that also generates revenue?
- Low IP4 Inventory
To date, this is the lowest IPv4 inventory we have had available for purchase. There may be a waiting list to even buy IP addresses in Q1 if demand continues to increase at the same rate it has been over the past year.
- High demand for IP Addresses
See ARIN recent report below that shows 15% more requests than actual transfers during September and October of 2020 which provides further indication that demand is high and supply is low, which will lead to increased IPv4 prices in Q1 of 2021